When you heat onions or toast bread, the sugar molecules bond to protein molecules. This bonding, which in cooking is called carmalization, is a result of the sugar molecules attaching to protein molecules. When this happens, a series of reactions occur (called glycation) that result in protein molecules bonding to each other.
Chemically speaking, yes. The process is slow and complicated, but over time more and more protein molecules are cross-linked. These cross-linked molecules don't function propoerly. When enough cross-linked molecules accumulate in a specific tissue (such as cartilage, lungs, arteries and tendons), there can be a change in function.
Basically, things become stiffer. When tissues stiffen, they do not function as efficiently. Many of the symptoms of aging have to do with the stiffening of tissues. Cataracts, for example, are a stiffening of your eyes' lenses.
No, but you can slow it down. Researchers believe that if the concentration of sugar in the blood is high, then more cross-linking occurs. Everyone could benefit from keeping their blood sugar from spiking. Foods with a high glycemic index, such as sugary sodas and juices, release sugar into the body quickly. These foods have been associated with cardiovascular disease, possibly because of protein cross-linking.
Sources:
Aging Under the Microscope; National Institutes of Health, National Institute of Aging.
Sugar and Cardiovascular Disease Circulation. 2002;106:523.

